Credit Problems Made Worse

Today, we received a letter for Amy who is 19 years old and has just moved out of home. The letter was from American Express, and is an invitation to apply for an American Express Gold credit card. Just what a 19 year old university student on working part time at K-mart, really needs!

The promise of up to $50,000 of credit is a big carrot to dangle in front of a young person, who may not know better. They may be desperate for credit or experiencing hard times, but I believe that our Amy would not fall for the lure of expensive credit in these troubled times.

Get this. The interest rate is advertised at 15.99% p.a. with up to 55 days interest free. How on hell would anyone on a casual wage be able to pay off any sum over $500 within the interest free period. Once past the interest free period, the interest rate would cripple a person, especially if they only paid off the minimum payment for the month. It would take many years to pay off the principle. Here is an example. Say you borrowed $500, and only paid off the minimum payment of $25 a month. It would take 20 months to pay off the principle. That is nearly two years folks! Then, of course you would still have to pay off the interest you have accumulated on top of that which is the kicker that people don’t take into account when they make a purchase on a card.

According to a simple credit card calculator I used, it would take 7 years and an extra $331 on top of the original $500 loan. That is bloody incredible. But who just purchases $500 on a credit card? According to Choice Magazine the average credit card debt for every man, woman and child in this country of $3,200. That is a record credit card debt of $44 billion outstanding as at 9 Oct 2008. That is a nice little earner for all financial institutions who issue these plastic perils!

Why would a young lady, just starting off in life be offered a scam like this? It makes me sick to think that a company, only after profits, would stoop that low. Shame on you Mr. American Express. No wonder the credit crunch started in North America if this is an example of how you market your product!

So, some friendly advice from one who knows. Don’t be sucked in by a credit card company offering cheap or easy credit. It will only end up in tears (yours of course), and they will take you to the cleaners without you even realising it!

How is one to live a simple life when bombarded with all this crap? Give me strength!

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About Gavin Webber

Gavin Webber's daily goal is to live a more sustainable lifestyle, in an effort to reduce his family's environmental footprint so we can all make a difference for our children & future generations to come.

Comments

My MOTS was listening to a podcast interview of a woman who just lost her house in the subprime crisis in the US.

She claims that she was not told about the increase in payments after the low payment intro period, and when the payments increased (get this!) from $600 a month to $2000 a month she found she couldn’t pay, and lost the house.

She’s arguing that the mortgage broker should have explained this to her, and it isn’t her fault that she didn’t ‘read the fine print’.

*sigh*

Too many people do not understand credit, or the limits of their own income. For years my MOTS and I have lived well within our means and saved a good amount of our income (and had no credit use), and wondered why everyone around us on much smaller incomes seemed to be doing so much better.

Now the elephants are coming home to roost, and the THUNK is audible around the planet.

There’s no such thing as something for nothing. I think that’s what people are learning right about now. A pretty basic lesson, but it might be real hard to learn.

Gav, Amy is a smart cookie, you brought her up well, I don’t believe that beautiful girl would fall into credit trouble with you guiding her. Dad.. You were always a smart cookie with money, us kids NEVER went withoutxoxooxx

Isn’t that crazy!I would be very upset. We really need to have legislative intervention. It’s like smoking advertising – it took litigation to change companies from preying on helpless individuals who they knew their product was bad for.

We raise our children teaching them about ‘stranger danger’ for their own protection. We will also have to teach them about guarding themselves from the marketing devils – banks, advertisers and ‘buy now pay later’ scammers.

I agree with everyone wholeheartedly. I too receive up to 4 of these letters in the post each month, from companies I have never had an account with. About 2 years ago, I asked my credit card company to lower my card limit from $22,000 to $6,000! They tried to put me off going through with it of course, and I said I didn’t care, and went ahead anyway. We have never looked back!

It is a crime to tempt people who are not financially literate into signing up for credit, when they have no idea how it works and how much it will cost them.

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About Gavin Webber

An Ordinary Australian Man Who Has A Green Epiphany Whilst Watching A Documentary, Gets a Hybrid Car, Plants A Large Organic Vegetable Garden, Goes Totally Solar, Lowers Consumption, Feeds Composts Bins and Worms, Harvests Rainwater, Raises Chickens, Makes Cheese and Soap, and Eats Locally. All In The Effort To Reduce Our Family's Carbon Footprint So We Can Start Making A Difference For Our Children & Future Generations To Come.

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very good

June 28, 2015 by Scared pax from United Kingdom

This is a great podcast if you want to improve your life in so many aspects and become a more sustainable person. I love the soothing voice, the good pace, and it contains lots of useful information. Recommended!

opened my eyes

May 25, 2015 by Gorn4lyfe from Australia

A wonderful show!

Inspiring

April 30, 2015 by Alan Whelan from Ireland

This is a great podcast if you're looking for practical info on saving money by living more sustainably from someone who's made that journey over the last few years. Told in a nice, easy conversational style

Green Living, inspiring and practical

January 8, 2015 by EliseMac from Australia

Thanks Gav for sharing what has (and hasn't) worked along your journey for living a greener lifestyle. Inspiring and achievable for anyone, I look forward to this podcast weekly.

Local food equals less waste

December 27, 2014 by allotmentadventureswithjean from Australia

Another brilliant podcast from Gavin Webber encouraging us, and showing us how, to cut down on food miles, growing our own food, and cutting down on food waste. Gavin is a really interesting speaker, showing us how to eat better, growing our own food and how to live more sustainably.

Honestly australian

December 15, 2014 by HodgepodgeOz from Australia

Fantastic podcast, with a wide variety of well thought and researched topics. Gavin is a honest, forthright pod aster with a genuine interest in helping others get green. Like a day alongside is a day wasted, so too is a week without listening to Gavin. Highly recommended for people starting out, or those in the midst of their new lifestyle. Keep it up Gavin, wish there were more great reviews! Kimberley

Morning motivation

December 8, 2014 by Bunnyworm from Australia

Gavin has a great passion for living this greener lifestyle that motivates others to do the same. The podcasts are always interesting and informative. :)

Passionate Advocate

October 18, 2014 by Bbgalpz from Australia

Gavin's enthusiasm and passion for creating a more sustainable world is nothing short of contagious. Thanks Gav, you are my weekly source of motivation for living a sustainable life! :)

Gavin speaks from the heart

October 13, 2014 by Green gavin from Australia

Gavin's podcasts are required listening for anyone planning to live a more sustainable life. He doesn't preach, but tells you his story from the heart. You'll laugh, smile, share in his concerns and along the way you'll pick up some great tips on living a simple life.

Green thoughts, so well iterated

October 9, 2014 by Kwasikwami from Australia

This is a wonderful podcast. Not only does Gavin talk knowledgeably on a range of sustainability topics from gardening tips all the way to the issues facing humanity as a whole, but he does so in such a wonderful voice, it's like listening to my Dad, love it!!

Easy listening inspiration on being green

September 24, 2014 by Broomedy from Australia

Gav knows how to share his journey to a more sustainable life in a manner that shows just how easy it really is. Not to mention healthier, economically beneficial and generally rewarding. The podcasts are an easy way to absorb Gav's great lifestyle. I recommend to anyone.

Passionate Advocate

September 10, 2014 by Bbgalpz from Australia

Gavin's enthusiasm and passion for creating a more sustainable world is nothing short of contagious.

Thanks Gavin!

August 31, 2014 by Honeywoodmilk from Australia

Great practical advice for a greener lifestyle. This podcast is for anybody interested in growing their own food in suburbia, saving electricity, brewing beer, making cheese, all that wonderful business and most of all, saving money! Thanks Gavin, love the podcast mate!

Enjoyed those ideas for staying warm

August 15, 2014 by enduringdragon from United States

Like you we are having winter here in Chile—brrr! Every bit we can save on heating we will.

Green Podcasts

July 26, 2014 by Carneu from Australia

Excellent podcasts, which are full of information to help get started on a sustainable lifestyle.

Practical ideas and inspiration

July 19, 2014 by HeathrowHeath from Australia

I highly recommend Gavin's podcast and blog. Down to earth, entertaining and inspirational. Thank you.

Interesting & easy to listen to

April 27, 2014 by Velocity3 from New Zealand

Gavin & his guests make this green journey lots of fun.

Green living for renters

April 26, 2014 by allotmentadventureswithjean from Australia

Always worth checking out Gavin's podcasts as he covers all aspects of sustainable living in the suburbs. This podcast is of particular interest to folk who want to live more sustainably whilst living in rental accommodation. Some great ideas.

Great green listen

April 18, 2014 by Obscurenickname from Australia

Gavin is a great down to earth, tell it like it is aussie with a passion for sustainability and growing food and making cheese